Non-Price competition measures used by cocoa purchasing clerks in Ghana and their determining factors

The partial liberalization of Ghana’s cocoa market in the 1990s led to the Cocoa Marketing Board (COCOBOD) granting licenses to private companies to partake in the domestic cocoa market alongside the state-owned Produce Buying Company (PBC) at predetermined prices while maintaining the right to export cocoa. After this partial liberalization, these Licensed Buying Companies (LBCs) have resorted to non-price measures to compete for larger market share due to their inability to pay cocoa farmers outside the set prices. This study investigates the factors that determine the choice of non-price competition measures used by cocoa Purchasing Clerks (PCs) to compete. The study used primary data collected from the Western North and Ashanti regions of Ghana. A multistage sampling technique was used to select a total of 150 cocoa PCs who work for LBCs. Also, 13 key informants including 11 cocoa District Officers (DO) and 2 Assemblymen were interviewed to get a general understanding of the cocoa marketing structure. The study adopted the binary logistic model to analyze the determinants of non-price competition measures. The results showed that certification, contract, experience, and region were the most determining factors of non-price competition measures used by cocoa PCs. Other socio-economic factors of PCs like income, gender, marital status, and age influenced the use of some of the non-price competition measures. We recommend that all (both local and foreign) LBCs operate certification programs as the benefits derived from such programs will boost the sustainability of the Ghana’s cocoa market which intend improves cocoa farmers livelihoods.